Marquest Medical Products, Inc. v. Emde Corp., Civ. A. No. 80-K-61.

• Decision Date: 10 September 1980
• Docket Number: Civ. A. No. 80-K-61.
• Citation: 496 F. Supp. 1242
• Parties: MARQUEST MEDICAL PRODUCTS, INC., a Colorado Corporation, Plaintiff, v. EMDE CORPORATION, a Nevada Corporation, James H. Buckingham, M.D., E. J. Snyder, Robert B. Stone, M.D., and Ronald J. Logar, Individuals, Defendants.
• Court: U.S. District Court — District of Colorado

496 F. Supp. 1242

MARQUEST MEDICAL PRODUCTS, INC., a Colorado Corporation, Plaintiff, v. EMDE CORPORATION, a Nevada Corporation, James H. Buckingham, M.D., E. J. Snyder, Robert B. Stone, M.D., and Ronald J. Logar, Individuals, Defendants.

Civ. A. No. 80-K-61.

United States District Court, D. Colorado.

September 10, 1980.

David F. Zinger, Sheridan, Ross, Fields & McIntosh, Denver, Colo., for plaintiff.

Timothy J. Martin, Young & Martin, John J. Gibbons, Denver, Colo., for defendants.

ORDER

KANE, District Judge.

Defendants have moved to dismiss for improper venue under 28 U.S.C. § 1391 and absence of personal jurisdiction. Plaintiff Marquest Medical Products, Inc., a Colorado corporation, filed this action on January 15, 1980, seeking a declaratory judgment of non-infringement of patent, patent invalidity, interference with business relations and patent misuse. Marquest also seeks injunctive relief, compensatory damages and punitive damages. Marquest manufactures and sells syringe-like devices which collect blood samples called the "Omnistick" and "Ministick." Defendant EMDE, a Nevada corporation, is the alleged holder of U.S. Letters Patent No. 4,133,304 to a syringe—like device which collects blood samples called the "Mosquito." Marquest has also named various officers and stockholders of EMDE as defendants — all residents of either Nevada or California.

Marquest bases its action against defendants on diversity jurisdiction pursuant to 28 U.S.C. § 1332. Marquest further alleges that venue is proper against defendant EMDE because the corporation does business in Colorado, 28 U.S.C. § 1391(c), and proper against the individual defendants because the cause of action arose in Colorado. 28 U.S.C. § 1391(b). Moreover, Marquest claims that personal jurisdiction and venue is proper because defendants have waived any jurisdictional defenses by their conduct in submitting to the jurisdiction of this court and by their failure timely to raise any objection. I agree and therefore the motion to dismiss is denied.

FACTUAL BACKGROUND

On August 17, 1979, defendant Logar, for EMDE, sent a letter to Marquest claiming that the manufacture and distribution of the "Omnistick" and "Ministick" violated EMDE's "Mosquito" patent, U.S. Letters Patent No. 4,133,304. Logar requested Marquest immediately to cease and desist the manufacture, distribution, sale, or other use of the syringe and stated that failure to do so would precipitate legal action for patent infringement.

As early as September, 1979, defendants sent letters to present and potential customers of Marquest's syringe-like devices asserting that Marquest had infringed the "Mosquito" patent. In these letters defendants warned the customers that failure to cease and desist use of the "Omnistick" or "Ministick" arterial blood gas syringes would result in immediate legal action by EMDE against the customers. Copies of these letters were signed by defendants Logar and Buckingham. A letter by defendant Snyder to EMDE dealers evidences his acquiescence.

Marquest filed this action on January 15, 1980. In late February defendants filed their first request for extension of time to answer Marquest's complaint, which I granted on February 25, 1980. Defendants filed their second request for extension of time on March 12, 1980, after Marquest had moved for a preliminary injunction on March 3, 1980. Defendants' request was based on the recent appointment of additional counsel which necessitated more time to prepare for the preliminary injunction hearing set for March 21, 1980. I also granted this extension.

In its motion for preliminary injunction Marquest requested generally that defendants be enjoined from further representation to Marquest's customers that it had violated the "Mosquito" patent and that use of the "Omnistick" or "Ministick" would result in legal action. On March 18, three days before the hearing on the motion, defendants and Marquest entered into a written stipulation to the entry of a preliminary injunction "during the pendency of the trial" which I made an order of this court on that day. The order enjoined defendants generally from representing Marquest to be in violation of the "Mosquito" patent and restraining Marquest generally from misrepresenting the ownership of the Mosquito syringe, claiming any affiliation with EMDE, or asserting the invalidity of EMDE's patent. On March 20, 1980, I ordered the withdrawal of Marquest's motion for preliminary injunction in lieu of the written stipulation and cancelled the hearing set for March 21, 1980. On April 3, 1980, defendants filed the motion to dismiss alleging improper venue and lack of personal jurisdiction.

Marquest pursued discovery during May serving interrogatories and requesting the production of documents. Defendants twice moved for extensions of time, both of which I granted, requesting in total seventy-five days within which to respond to Marquest's requests for information regarding only the personal jurisdiction and venue issue. Defendants tendered answers and documents on July 28, 1980.

WAIVER

Personal jurisdiction is a question of the court's power to exercise control over defendants while venue is primarily a matter of choosing a convenient forum. Leroy v. Great Western United Corp., 443 U.S. 173, 180, 99 S.Ct. 2710, 2715, 61 L.Ed.2d 880 (1978). See generally Wright, Miller & Cooper, Federal Practice and Procedure § 3801, at 3-6 (1976). Both are personal privileges of the defendant and both may be waived. Leroy v. Great Western United Corp., 443 U.S. at 180, 99 S.Ct. at 2715, Neirbo Co. v. Bethlehem Shipbuilders Corp., 308 U.S. 165, 167-168, 60 S.Ct. 153, 154-155, 84 L.Ed. 167 (1939).¹ As the Supreme Court stated in Neirbo, privilege defenses such as lack of personal jurisdiction or improper venue may be "lost by failure to assert them seasonably, by formal submission in a cause, or by submission through conduct." Id. at 168, 60 S.Ct. at 154-155. Although defendants have not formerly consented to this suit I find that by their untimely objection to jurisdiction and venue and by their conduct they have submitted to the resolution of this dispute by this court.²

While I agree that the mere filing of or participation in a motion does not necessarily entail a waiver to the defenses of lack of personal jurisdiction or improper venue, Altman v. Liberty Equities Corp., 322 F.Supp. 377, 379 (S.D.N.Y.1971), defendants have waited some six to ten weeks since the complaint was served to object to this court's venue and jurisdiction over their persons. Defendants objected only after having submitted to an order of this court by their stipulation which restrains them from acting as was requested by Marquest in its motion for preliminary injunction. Furthermore, defendants received affirmative preliminary relief by obtaining injunctions against certain actions by Marquest in that same order.

It is beyond peradventure that had defendants appeared at the hearing on Marquest's motion for preliminary injunction, waiver would have been a fait accompli. See Wyrough & Loser, Inc. v. Pelmor Laboratories, Inc., 376 F.2d 543, 547 (3d Cir. 1967), Backo v. Local 281, United Bro. of Carpenters & Joiners, 438 F.2d 176 (2d Cir. 1970) cert. denied, 404 U.S. 858, 92 S.Ct. 110, 30 L.Ed.2d 99 (1971). A litigant must exercise great diligence in challenging personal jurisdiction or venue; he should do so at the time he makes his first defensive move. See Wright & Miller, Federal Practice and Procedure § 1391 at 855. Although at the hearing on the preliminary injunction the burden would have been on Marquest to show irreparable injury and the probability of success on the merits, Penn v. San Juan Hospital, Inc., 528 F.2d 1181 (10th Cir. 1975), defendants would have been required to rebut Marquest's contentions-rebuttal arguments going to the merits of the case.³ In that instance, the "defensive action" would be similar to that present in the filing of a motion for summary judgment which the Tenth Circuit has found to be sufficient submission of a dispute to a court for resolution to warrant a waiver of any objection to jurisdiction or venue. See Thompson v. United States, 312 F.2d 516 (10th Cir. 1962), cert. denied, 373 U.S. 912, 83 S.Ct. 1303, 10 L.Ed.2d 414 (1963). In Thompson the court found that the defendant movant's action went to the merits of the case.

By stipulating to an injunction which restrains both parties, defendants have avoided actual argument on the probability of success or failure of the merits of Marquest's claims. At the same time they have received affirmative preliminary relief under order of this court. I need not dwell on the obvious: in adopting the stipulated agreement I considered the propriety of the mutual injunctions in light of the facts and law in this case, albeit not determining the ultimate resolution of the litigation. Preliminary matters such as personal jurisdiction or venue should be raised and disposed of before a court considers the merits or quasi-merits of a controversy. Wyrough & Loser, Inc. v. Pelmor Laboratories, Inc., 376 F.2d at 547. I agree with Marquest that defendants cannot "walk away" from this court order or this court's jurisdiction having once submitted themselves for the presumed advantages which they obtained.

The policy of conserving judicial time and effort by disposing of preliminary matters is paramount to the countervailing policy of affording parties to a suit time to plead procedural defenses, id.; especially where adequate time and opportunity are available. Defendants are not in the same position as the parties in Wyrough where only one week was allowed in which to prepare a jurisdictional defense before a hearing on the motion for injunction pendente lite. Even in those circumstances, the court found that the parties were not put in a "procedural straight jacket." Id. I also find that defendants had adequate time and are not being required to...